SOM Distilleries & Breweries Limited(BSE: 507514, NSE: SDBL)

Earnings Presentation H1 FY2020

2

Safe Harbor

This presentation contains statements that contain “forward looking statements” including, but without limitation, statements relating to theimplementation of strategic initiatives, and other statements relating to SOM Distilleries & Breweries’ future business developments andeconomic performance.

While these forward looking statements indicate our assessment and future expectations concerning the development of our business, anumber of risks, uncertainties and other unknown factors could cause actual developments and results to differ materially from ourexpectations.

These factors include, but are not limited to, general market, macro-economic, governmental and regulatory trends, movements in currencyexchange and interest rates, competitive pressures, technological developments, changes in the financial conditions of third parties dealingwith us, legislative developments, and other key factors that could affect our business and financial performance.

SOM Distilleries & Breweries undertakes no obligation to publicly revise any forward looking statements to reflect future / likely events orcircumstances.

Conference Call Details: Monday, November 11, 2019 at 4:00 PM IST

Dial-In Numbers

Primary Number +91 22 6280 1106 / +91 22 7115 8007

The numbers listed above are universally accessible from all networks and all countries

Toll Free Number

USA: 1 866 746 2133UK: 0 808 101 1573Singapore: 800 101 2045Hong Kong: 800 964 448

Highlights

Financial Highlights

Recent Developments

Company Profile

Operational Highlights

4

Highlights

H1 FY2020 vs. H1 FY2019

Beer Sales Volume

51.8 Lakh Cases+26.2%

IMFL Volume

6.7 Lakhs Cases+91.1%

Total Income

Rs. 2,698 mn+37.4%

EBITDA

Rs. 373 mn+14.5%

Total Volume

58.4 Lakhs Cases+31.3%

PAT

Rs. 171 mn+19.1%

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Management Commentary

The business environment during the second quarter remained challenging for the beerindustry on account of prolonged monsoon coupled with higher input cost prices. Extendedmonsoon season impacted the demand side of the industry whereas higher input cost pricesimpacted the profitability.

However, despite the prevailing industry scenario we were able to record a strong toplinegrowth of 37.4% y-o-y compared to H1 FY2019. Our EBITDA recorded a growth of 14.5% y-o-y during the same period. Our H1 FY2020 margins stood at 13.8%, a decline of 277 basispoints compared to same period last year. This decline was primarily attributable to higherinputs cost. Our Karnataka and Odisha facilities continued to generate positive EBITDA. Allour mainline brands performed well in their respective markets.

We are in the process of installing a canning line for beer in Odisha and expect it beoperational by late Q3 FY2020. This will help us in enhancing margins for the facility, whichwill start reflecting from Q4 FY2020.

Our performance in the first half of the fiscal year, further strengthens our view on theperformance of the remaining part of the year. We have already made significantinvestments for next phase of growth and the focus would be on generating returns.

Mr. JK Arora, Managing Director

Financial Highlights

Highlights

Recent Developments

Company Profile

Operational Highlights

7

Performance – H1 FY2020

Q2 y-o-y Six Months y-o-y

(Rs. Million) FY2020 FY2019 Growth (%) FY2020 FY2019 Growth (%)

Total Income 820 714 14.8% 2,698 1,963 37.4%

EBITDA 82 102 (19.9)% 373 326 14.5%

Margin (%) 10.0% 14.3% 13.8% 16.6%

Interest 37 28 31.0% 75 54 40.8%

Depreciation 24 19 27.5% 52 38 35.3%

Net Profit 25 31 (19.7)% 171 143 19.1%

Margin (%) 3.1% 4.4% 6.3% 7.3%

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Performance – H1 FY2020 vs H1 FY2019

• Beer Revenue increased by 31.6% y-o-y whileBeer volumes increased by 26.2% comparedto H1 FY2019

• IMFL Revenue increased by 79.9% y-o-y whileIMFL volumes increased by 91.1% comparedto same period last year

• EBIDTA growth during the six months was achieved despite industry challenges such as prolonged monsoon and higher input cost

• Both Karnataka and Odisha facility were EBITDA positive during the quarter

• PAT for H1 FY2020 included benefit of lower tax rate

• PAT included impact of higher depreciation and interest cost pertaining to Odisha facility

Total Income EBITDA Net Income

37.4% 14.5% 19.1%

6M FY2019 6M FY2020

1,963

2,698

6M FY2019 6M FY2020

326373

6M FY2019 6M FY2020

143

171

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Conservative Balance Sheet

Transformational growth investments funded without risking Balance Sheet

(Rs. Million)Sep 302019

Jun 302019

Mar 312019

Secured Borrowings 980 1,024 1,152

Unsecured Borrowings 699 605 514

Gross Debt-Consolidated 1,679 1,628 1,666

Less: Cash & Cash Equivalents 182 110 247

Net Debt 1,497 1,518 1,420

Gross Debt / Equity Gross Debt / LTM EBITDA

Credit RatingsICRA

(Sep 2019)Brickworks(Aug 2018)

Fund Based Facilities BBB+ BBB+

Non-Fund Based Facilities A2+ A2

Outlook Stable Stable

Outlook Revision to ‘Positive’ if

There is substantial increase in scale of operation and

market share

Revenues and profit show sustained improvement

0.38x

0.54x 0.50x 0.52x

Dec-18 Mar-19 Jun-19 Sep-19

1,141 1,666 1,628 1,679

1.81x

3.16x

2.73x2.92x

Dec-18 Mar-19 Jun-19 Sep-19

Operational Highlights

Industry Dynamics

Recent Developments

Company Profile

Financial Highlights

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Millionaire Beer Brands - Meeting the aspirations of our consumersQ

ua

nti

ty S

old

(in

la

kh

ca

ses)

(Lakh cases)

H1 y-o-y

FY2020 FY2019 Growth (%)

Total Beer 51.8 41.0 26.2%

Total IMFL 6.7 3.5 91.1%

+37.8%

(19.3)%

41.3%Rs. Mn

H1 y-o-y

FY2020 FY2019 Growth (%)

Total Beer 2,264 1,720 31.6%

Total IMFL 420 234 79.9%

Volume Mix

6M FY2019 6M FY2020

15.821.8

6M FY2019 6M FY2020

10.88.7

6M FY2019 6M FY2020

14.0

19.8

Q2 FY2019 Q3 FY2019 Q4 FY2019 Q1 FY2020 Q2 FY2020

88% 86% 84% 92%81%

12% 14% 16% 8%19%

Recent Developments

Industry Dynamics

Financial Highlights

Company Profile

Operational Highlights

13

Recent Major Developments

Major Developments

Woodpecker Distilleries started canning line of beer and launched Blackfort Lager (Sep 2018), IMFL production

(Oct 2018), production of Whitefox RTD (Jan 2019)

'Woodpecker’ Beer approved in the Canteen Store Department (Mar 2017)

Launched White Fox RTD Drink in new Cranberry flavour –Cosmo Cranberry - third flavor launched after the widespread

acceptance of two earlier flavors – Lemon & Orange

Established team in Mumbai to give more impetus to the Southern and Western regions of the country

Received approval for CSD supply to Rajasthan, Uttar Pradesh, Punjab and Karnataka

Successfully raised Rs. 1,000 million through preferential allotment to Karst Peak Asia Master Fund

and Vermilion Peak Master Fund (Jul 2018)

Acquired a brewery asset in Odisha with capacity of 42 lakh cases per annum (Jul 2018). Commenced operation

from March 2019

Woodpecker Distilleries and Breweries (Karnataka) commenced operation (Apr 2018)

Beer brands have been approved by F.D.A for supplying beer to the United States of America (Nov 2017)

Started supply of Woodpecker draught beer – filtered wheat beer to key markets in Bangalore (Oct 2019)

Company Profile

Industry Dynamics

Financial Highlights

Recent Developments

Operational Highlights

15

SOM Distilleries – Who we are

The only listed Beer and IMFL company in India....

SOM Distilleries

Gross Debt / Equity Ratio of 0.52x

Installed capacity of 15.2mn cases of Beer and 3.3mn cases of IMFL

Founded in 1993, flagship company of the SOM Group of Companies

Beer Contribution – 84% of the revenues in FY2019

FY2019 Revenues of Rs.3,967 mn; EBITDA Margins of 13%

7.59 million cases of Beer and 0.97 million cases of IMFL sold in FY2019

• SOM Distilleries & Breweries Limited (SDBL) is based in Bhopal and is one of the leading alcoholic beverages manufacturers inIndia. SDBL is primarily engaged in production of beer and blending and bottling of IMFL

• Offers a broad line of products at every price point to cater to varied preferences of the consumers. The product portfolio consistsof various options across beer, rum, brandy, vodka and whisky

• With 84% of the topline derived from beer, the Company has three key millionaire brands (sales more than 1 mn cases per annum)– Hunter, Black Fort and Power Cool. Hunter and Woodpecker brands are supplied as draught beer to all major hotels in MadhyaPradesh and Chhattisgarh

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Synergy Opportunities – Beer and IMFL Brands

• SOM’s Beer and IMFL portfolio complements each other and reduce the risk of seasonality• The Point of Sales for both IMFL and Beer is the same; thereby leading to marketing efficiencies

• Generates significant growth opportunities for the combined portfolio

IMFL BrandsBeer Brands

• Hunter Super Strong Premium Beer• Power Cool Super Strong Beer• Black Fort Super Strong Beer• Legend Premium Lager Beer• Woodpecker Lager Beer

• Pentagon Rum• Black Fort XXX Rum• Gypsy Rum• Sunny Rum

• Doctors Brandy

• Blue Chip Vodka• White Fox Vodka• White Fox Refresh (RTD)

• Pentagon Gold Edition Whisky• Legend Premium Whisky• 2Ist Century Pure Malted Whisky• GS Genius Whisky • Gypsy Whisky• Sunny Malted Whisky• Milestone 100 premium Whisky• Super Master Whisky

SOM Distilleries & Breweries Limited(BSE: 507514, NSE: SDBL)

Som Distilleries & Breweries Limited

(CIN: L74899DL1993PLC052787)

Registered Office:

Zee Plaza, 1 - A

Kamal Cinema Road

Arjun Nagar

Safdarjung Enclave

New Delhi 110029

Corporate Office:

SOM HOUSE

23, Zone II

Maharana Pratap Nagar,

Bhopal 462011

Ph.: +91 755 427 8827

Nakul Sethi

SOM Distilleries and Breweries

nksethi@somindia.in

+91 755 4271271

Bijay Sharma Churchgate Partners

som@churchgatepartners.com

+91 22 6169 5988